Queensland foreign investor surcharge increase confirmed in 2018 State Budget
Queensland Treasurer Jackie Trad delivered her first State Budget this week, announcing an unexpected $1.5 billion surplus – three times the amount predicted in December.
The Budget also allocated $5.6 billion in concessions in transport and utilities for eligible Queensland residents.
To fund the new concessions, the Government has announced a range of new tax measures, 2 of which are related to property owners and investors.
Investor taxes
The Treasurer confirmed earlier reports that the State will increase the ‘Additional Foreign Acquirer Duty’ (AFAD) for foreign property investors from 3% to 7% on 1 July 2018.
The state will also increase the land tax rate for aggregated holdings above $10 million – also applicable from 1 July 2018.
First home buyers
Unfortunately for first-home-buyers, the Government has cut its first home owner’s grant from $20,000 to $15,000 from the 1st of July 2018.
“We expect this announcement will encourage first home buyers to bring forward their decision making to take advantage of the grant before it expires,” said Ironfish National Apartments Manager, William Mitchell.
“To be eligible for the full $20,000 buyers need to have a contract signed before 1 July 2018, but do not have to settle the property – allowing more time to save towards their deposit.”
Infrastructure spend
Major infrastructure spending was a key theme of the Queensland 2018 Budget, with $45 billion worth of infrastructure to be spent over the next 4 years. Out of this, $11 billion will be spent in 2018 / 2019 alone – making this year’s infrastructure program the largest since 2011.
Brisbane’s Cross River Rail project will receive $700 million in funding for the next financial year, with M1 and Bruce Highway also receiving significant upgrades.
Queensland’s infrastructure investment is also expected to create around 40,000 jobs in the process.
“It’s a Budget that gears our state for growth,” Ms Trad said. “We make no apologies for borrowing to invest in infrastructure. It’s the right thing for jobs today, but it’s also critical for economic productivity in the future.”
The Government is also investing in education and health with:
- Extra classrooms to be built across 57 schools as part of education infrastructure initiative – a total of $250m will be spent over the next 2 years
- 4 new schools including Fortitude Valley and Dutton Park at a cost of $808 million over four years.
- $85 million in the education budget to redevelop TAFE campuses across the state
- A $17.3 billion operating budget for the health system, plus $985 million in capital spending on health services and facilities.